When we asked corporate legal clients how their planning and priorities have changed given the events of 2020, we got the answers you’d expect. They plan to decrease spend but find themselves busier than ever. Despite that, overall law firm demand declined by 5.9% in Q2 – the largest decline since 2009.
With decreasing spend and increasing workloads clients are asking firms to do more with less. This means firms must look for ways to increase revenue from existing clients in lieu of more traditional growth tactics.
What do legal clients want today?
Notably, three things stood out when we asked GCs what they want from firms today. They want:
Use newsletters, webinars, or other knowledge hubs to share key information with your clients. With legislation, regulations, and industry landscapes shifting, clients are looking for the most up-to-date information. And be proactive. Waiting for a phone call or email is a surefire way to lose a top spot.
Key to the success of this strategy is relevance. Your clients are busy and need only the most pertinent information. A newsletter with too much fluff or irrelevant information will quickly find its way to the spam folder. Instead, create a focused, sustainable stream of knowledge sharing that keeps your clients in the know without getting in the way.
Timely, relevant advice
As clients’ focuses shift, most law firms have had to find ways to adjust resources and expertise to meet client demands. For example, our respondents expect their labor and employment work to increase in the coming months. Firms who anticipate and respond quickly to this evolution stand to gain a larger share of wallet.
Remaining agile continues to be the primary challenge for many firms. Partners with years of expertise in M&A might suddenly see an influx of bankruptcy or employment work. Clients don’t want to wait for their law firms to get up to speed with these new matters. They expect the same expert-level advice in the time frames they’re accustomed to. There are several workflow and support tools available that can assist your lawyers as they transition across practice areas.
Efficient, effective service
At first blush, this request may seem obvious. Clients have always wanted efficient and effective service. But today, this frequently means clients asking firms to do work for free. With budgets stretched thin for both firms and clients, working for free is not possible. However, this presents an opportunity for savvy firms to improve the way they collaborate with clients.
Interdisciplinary teams that leverage legal, technology, and business expertise can more quickly address client requests at a lower cost. In fact, our respondents cite resourcing and knowledge sharing as their top two desired areas of innovation for their firms. A focus on collaborative, agile teams will allow you to keep costs low and meet client expectations while continuing to grow your business.
Which strategies deliver the most growth?
Our research has identified seven primary methods of increasing your share of your client’s external spend, even during this tumultuous time.
There are three strategies we’d like to highlight as we move into 2021. It’s clear that clients expect law firms to evolve, and these are the approaches that will yield the best results.
It may be difficult to talk about innovation amid the COVID-19 pandemic. Many firms are focused on getting through and remaining profitable. But clients have become even more discerning about which of their firms stand out and which can deliver the best value. In a market filled with competitors reducing technology investments and retreating to standard tactics, you have an opportunity to revenue through innovation.
While most of the partners we surveyed want technology-driven innovation, clients are looking for new approaches wherever they may be. This may mean virtual deal rooms, new fee structures, or simply new ways of communicating. Look for simple ways to innovate your client experience and stand out from your competitors. No-cost or low-cost innovation can help you weather the lean times and pave the way for more significant innovation when the time is right.
Notably, industry expertise is correlated with a significantly greater portion of client spend than brand affinity. With so much upheaval across industries, it’s clear that clients rely heavily on outside counsel to help them stay up to speed with legal and regulatory changes. In the face of rapid changes and immediate needs, long-standing relationships are being tested.
Even existing clients are inclined to seek out firms with deep knowledge of their industry even if they have no prior relationship. Get ahead of this risk by deepening your existing client relationships. Show them your industry expertise and remind them of the value that adds to your services. Be sure to stay in touch with your clients so you know when their needs change and can be ready to respond.
There are many definitions of ‘collaborative teams’ that clients may have in mind. But with the greatest share of spend among our respondents, 56%, it’s worth unpacking. Bolstered by technology, GCs have been demanding and creating more collaboration with their firms for several years. For firms to respond in a profitable manner, they must also create a culture of internal collaboration. Widespread remote work makes this challenge greater, but technology makes it possible.
But the strength of this approach is rooted in a culture that embraces client collaboration. Make clients part of the legal team with real-time access to documents and communication tools. When clients feel included in the process and part of an interdisciplinary team, they spend significantly more with your firm.
Where do you start?
The good news is that you’ve already taken the first step – learning what most clients want. Take an assessment of what you know about your clients and what assets you currently have. This kind of analysis should reveal some low-hanging fruit that you can address quickly.
Significant increases in your share of your clients’ wallets will likely require more planning. Big changes to resourcing, approach, or technology will have the most impact for your clients. Look for tools that allow you to scale your investment over time.
Whether you make big changes or small ones, the only thing you can’t do is remain static. And we know that you’ll likely need some help. Learn how HighQ can help you gain a greater share of your clients’ wallet.
This article appeared first over at the Thomson Reuters global blog. We have republished the piece here on Legal Insight with full permission from the publication.